Opinion | We should leapfrog our way out of the telecom mess

Any way you look at it, Big Telecom’s race in India is run. A price rise or two might help shore up their finances temporarily, but in the long run, operators will have to radically alter their business plans to survive. Even a bailout on the adjusted gross revenue (AGR) dues will only offer a partial reprieve. Don’t forget, Vodafone Idea’s spectrum dues to the government are ₹88,000 crore, while those of Bharti Airtel are ₹45,000 crore. This is on top of the cost of servicing the huge debt pile amounting to nearly ₹2.2 trillion between the two.

Jio has circumvented the debt problem with parent company Reliance Industries Ltd (RIL) announcing that it would take over debt worth ₹1.08 trillion from its telecom subsidiary, in exchange for an equity investment of the same amount. That still doesn’t alter the need to post reasonable returns on the investment. At current tariff levels, it is clear even Jio isn’t going to be making too much money from regular telecom services, which is why it has tried to position itself as a content-cum-entertainment platform.